Selling Your Home Above Market Value
When you sell your home you have the decision to ask for whatever price you want. Whatever factor you derive at your home’s value, just make sure you don’t price it astronomically above the market value or you might suffer the consequences. Often sellers gravitate to the high sales price especially in a hot market where lots of buyers are competing for scarce inventory, even then it is not wise to overreach.
If your home is on the market and you are not getting interest in the first few weeks, chances are, you’ve priced your home above market value. An overpriced listing can turn off potential buyers. Take a look at the chart below and see how pricing a home at fair market value gets fair exposure to potential buyers.
How you price your home will directly impact how many buyers, showings, and offers you attract. The higher you price your home above market value, the less buyers will look for your property. Not getting enough exposure somehow leads to a string of negative results:
- Buyers don’t buy overpriced properties
- An overpriced listing will not get as many showings as a home that is priced correctly
- You will end up reducing your price if your listing has been on the market for long
- By the time you reduced your asking price, your home become overly exposed
- Even if you do get a serious offer, the excessive price can lead to a mortgage rejection for the buyer once an appraisal was done to your home which leads to critical lost time waiting for finance approvals that will never go through.
If you haven’t sold your home yet, re-evaluate your price. Sellers who overprice their homes even just 10% above market value, then reduce the price one or more times after the home has been sitting on the market for long often end up getting less than they would have if they’d priced it realistically from the start.
Overpriced homes most often get ignored. If you would like to sell your home fast, you have to price it realistically right from the beginning, that way you can maximize your home’s exposure and attract the right buyers who are willing to pay top market value for your home.